Stephen Simpson, CFA
Long only, growth at reasonable price, value, research analyst

HollySys Executing Well, But Process Automation Is A Rough Neighborhood

I still believe that there will be substantial adoption of discrete and process automation in the coming years, and that key markets like China will increasingly look to substitute products sold by ABB (NYSE:ABB), Fanuc (OTCPK:FANUY), and Honeywell (NYSE:HON) with "home-grown" solutions. The problem for companies like HollySys (NASDAQ:HOLI) (also sometimes spelled "Hollysys") is that by no means precludes some pretty scary stretches of end-market weakness along the way. Process automation is a pretty rough place to operate right now; Honeywell did fine in the fourth quarter, but ABB and Emerson (NYSE:EMR) were both in the range of double-digit revenue declines due to ongoing weakness in markets like oil/gas, ...
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